In a recent judgment by the Supreme Court of India, the validity of the extension of Section 13-B of the Rent Act to Chandigarh was affirmed. The case delved into the legal authority behind the Notification dated 09.10.2009 under Section 87 of the Reorganisation Act. Stay tuned as we break down the legal intricacies of this ruling and its implications on rent control laws in Chandigarh.
Facts
- Section 13-B of the Rent Act allows Non-Resident Indians to recover immediate possession of residential/non-residential buildings in Chandigarh and urban areas of Punjab under certain conditions.
- The definition of ‘Non-Resident Indian’ in the Rent Act criteria for individuals of Indian origin settled outside India.
- Conditions include a five-year ownership period and limit the application for possession to one building per owner.
- Owners regaining possession must not sell or let out the property for five years after possession, or the evicted tenant can seek restoration through the Controller.
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Issue
- Notification dated 09.10.2009 issued under Section 87 of the Reorganisation Act extending Section 13-B of the Rent Act to Chandigarh by executive action is being questioned for its validity.
- The main issue deals with the validity of the extension of Section 13-B of the Rent Act to Chandigarh through executive action.
- The question revolves around whether the Notification dated 09.10.2009 under Section 87 of the Reorganisation Act had the legal authority to extend Section 13-B of the Rent Act to Chandigarh.
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Analysis
- Section 19(2-B) of the Rent Act imposes penalties on Non-Resident Indian landlords who evict tenants but do not occupy the premises or let them out to others.
- Sections 87, 88, and 89 of the Reorganisation Act give power to extend enactments to Chandigarh and adapt laws for Punjab, Haryana, Himachal Pradesh, and Chandigarh.
- Section 18-A of the Rent Act provides a summary procedure for NRI landlords to recover possession without the right to appeal.
- The procedure under Section 18-A includes the filing of an affidavit by the tenant to contest eviction, granting leave by the Controller if necessary grounds are shown, and hearings scheduled within a month.
- Scheduled buildings are defined in the Act as residential buildings used by professionals for both business and residence.
- Section 13-B restricts NRI landlords from transferring or letting out the building they evicted a tenant from for five years.
- NRI landlords can choose from various residential buildings or scheduled buildings for eviction purposes as per Section 13-B.
- Section 13-B of the Rent Act grants Non-Resident Indians the right to claim eviction for a genuine need by a summary procedure.
- The Amendment Act made by the State Legislature of Punjab with regard to NRIs was within its competence.
- The Rent Acts and Central enactments concerning NRIs do not exhibit repugnancy.
- The provisions of Sections 18-A(4) and (5) allow the tenant to defend proceedings initiated under Section 13-B.
- The restriction on resale and re-letting properties and the requirement to possess the property continuously for three months post-eviction were imposed.
- The legislations provided rights by a controlled mechanism and riders to various landlord groups like government servants, armed forces, etc.
- The order for recovery of possession made by the Controller is not appealable but may be reviewed by the High Court.
- Classification of NRIs as a separate category for Section 13-B eviction is valid and serves public interest.
- The requirement of the landlord’s suit accommodation must be genuine and necessitates a genuine need.
- The Controller has the power to hear the eviction application which must comply with conditions specified in Section 13-B.
- The test to judge the validity of any classification must be practical and pragmatic by looking beyond the classification to the purpose of the law and the circumstances that necessitated passing the law.
- The title of Section 25-B indicates a special procedure for the disposal of eviction applications based on bona fide requirement.
- The amendments in the Rent Act aim to provide a speedy and effective remedy for landlords under specific sections, avoiding lengthy legal processes.
- Notifications extending Rent Act were challenged, but upheld as they did not conflict with any parliamentary enactment or throw out existing laws in the Union territory.
- Executive power to extend amendments to Rent Act is considered permissible in conditional delegation.
- The purpose of amending the Rent Act was to provide relief to NRIs facing difficulties in recovering possession of their properties due to existing rent laws.
- There is a distinction between conditional and delegated legislation, where the former involves determining when a legislative rule becomes effective.
- The concept of ‘bona fide requirement’ necessitates a genuine need, not merely a desire, to evict a tenant.
- The classification of landlords with personal necessity for quick eviction as a separate class has been deemed valid and not discriminatory.
- Rent control legislation should be fair to landlords and balance the interests of both landlords and tenants.
- A classification based on intelligible differentia and rational nexus to the object sought to be achieved is permissible under Article 14.
- Delegated legislation does not empower making new laws but transplanting existing laws without material change.
- Tenants cannot claim discrimination if certain protections are withdrawn by an amendment to benefit landlords, as long as common law rights are preserved.
- The classification in this case cannot be treated as an arbitrary classification infringing Article 14 of the Constitution.
- The factual findings of the case were not interfered with as the challenge based on the unconstitutionality of the classification was rejected.
- The right of the tenants to establish their case on merits by disproving the genuine requirement of the Non-Resident Indians needs to be balanced.
- Section 13-B was considered in the judgment.
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Decision
- There is no order as to costs in the case.
- The court did not analyze the factual details of each case but focused only on the legal issues raised.
- The constitutional validity of Section 13-B of the Rent Act was upheld, including its extension and applicability to the Union Territory of Chandigarh.
- The appeals by the tenants in the cases would be dismissed based on the findings.
Case Title: RAM KRISHAN GROVER Vs. UNION OF INDIA
Case Number: C.A. No.-008597-008597 / 2019
